Raise the Roof: a Look at the U.S. Debt Ceiling

iPad 5:37 PM 82 % RAISE THE ROOF THE U.S. DEBT CEILING & THE GLOBAL IMPLICATIONS OF A DEBT DEFAULT HOW HIGH CAN WE GO? The debt celing was implemented and set at S1u5 bilion in 1917 under the Second Liberty Bond Act of 1917. It allowed the U.S. to fund World War i by seling bonds to the public, keeping interest rates to a minimum. Since then. Congress has raised the celing over 100 times. The government needs to issue an additionai S738 bilon in + $738 debt above the S343 trilien cap to meet its obligations for the remainder of the current fiscal yea. Ths means that to BILLION avoid raising the cap. the federal goverment would have to $11.5 $14.294 • eiminate al spending on discretionary programs (everything from the FBI. National Parks. the FAA. the VA. etc) Since 1995, Congress has BLION increased the debt celing 1917 12 times to its current cut 70 percent of outiays for mandatory programs (such as Social Security or TRILLION level of S4294 trion increase revenue collection by nearty two-thirds or TODAY some combination of the three $25 According to estimates from the Congressional Budget Office, the US. debt limit could exceed S25 trilion in TRILLION 2021 f current laws remain in place. 2021 MULTIPLE POINTS OF VIEW "IF ANYONE WANTS TO (CAP THE DEBT CEILING). WHICH I THINK WOULD BE CATASTROPHIC AND UNPREDICTABLE, I THINK THEY'RE CRAZY." "IT'S TRUE ALLOWING AMERICA TO DEFAULT WOULD BE IRRESPONSIBLE . BUT IT WOULD BE MORE IRRESPONSIBLE TO RAISE THE DEBT CEILING WITHOUT SIMULTANEOUSLY TAKING DRAMATIC STEPS TO REDUCE SPENDING AND REFORM THE BUOGET PROCESS." Jamie Dimon. CEO and Chairman of JPMorgan Chase & Co. previous Class A drector of the Board of Directors of the New York Federal Reserve. speaking to the US. Chamber of Commeroe US. House Majority Leader John Boehner in a speech to the Economic Club of New York LARGE CEILING, BRITTLE WALLS WHAT HAPPENS WHEN THE US REACHES THE DEBT CEILING? If no apreement is reached by that date, the Treasury Department warns that payment on the following obligations would be canceled or delayed: Even though the US. nt the S143 trilion debt imit on Monday. the country has not yet delaulted. By suspending payments to two federal pension funds. the Treasury Department estimates it can stave off a default unti August 2. • Social Security and Medicare benelits Veterans'benefits . Federal worker salaries and retirement benefits Corporate and individual tax refunds • Unemployment benetits to states • Delense vendor payments • Interest and principal payments on Treasury bonds and other securities . Student loan payments Medicaid payments to states Day to dey operations payments te keep gevernment facities open • Miltary salaries and retirement benefits